AT&C loss reductions: Permanent agency to be set up for baseline, assessment data collection

In order to facilitate the effective evaluation of financial parameters and AT&C losses of utilities, the power ministry has proposed to establish a permanent assessment agency that will be responsible for collecting the pertinent data, on half yearly basis initially, and quarterly subsequently.

The power utilities would be mandated to supply provisional data to the agency, which will get the veracity of the information vetted by independent agencies, such as CRISIL and ICRA.

In order to comply with this stipulation, the discoms would have to ensure uniformity and standardization of their respective accounting practices and data maintenance. At present, only eight utilities are able to furnish such data on a regular basis to PFC Limited, which uses the figures for its own internal ratings.

In time, provisional data would be replaced by audited data, which, at present, is supplied only one to two years after the end of each financial year.

The power ministry has suggested that the following parameters be a part of the proposed mechanism to be set up for rating the power utilities of the country:

• Reduction of AT&C losses
• Timeliness of preparation of accounts
• Timely submission of data to above agency
• Adequacy of tariff
• Supply hours to subsidized sectors
• Adoption of MYT
• Timeliness of submission of audited accounts
• Timely implementation of tariff order
• Position of receivables
• Coverage ratio
• Existence of good governance and management practices